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Tuesday, November 23, 2021

Between To be or Not to be a home owner, I prefer to be a Dividend Queen without a castle

A bit earlier in November, I was reaching my highest net worth ever, welcoming a $340,312.77 net worth. Following those good results, a reader asked what's next, if I was looking to buy a house. It's a good question that certainly can be addressed. A 340k net worth is a nice amount, but for me, it's not enough to own a home. Add to that my age, 41. For a person my age, my net worth is quite small. Despite it all, I am not looking forward to work until late in my 70s if you see what I mean.

Owning a house or condo involved a lot of money spending, for insurance and maintenance, among others. For some people, it's something important to own their home. It's not something that matters to me. Owning a home involved a lot of financial stress, It's a responsibility, and also, it can come with some major problems. 

You might believe that insurance will have your back in case something happens to your beloved home. Well, let me tell you that things could turn out to be much more difficult than you might believe. I will just tell you a couple of true stories. I will start with this one: in my little town, where I am spending the next couple of months in New Brunswick, a senior couple had a problem with their heating system. Unfortunately for them, the problem results in several thousand worths of damages to their property. They had insurance, but their insurance refused to pay because the damages were related to their heating system. Their insurer claims that their insurance doesn't cover the heating system...

Back in Montreal, I know two persons whose condo had suffered from water damage coming from a fire. For both cases, even if they didn't have a fire in their condo, their condo was no longer habitable because of the water damage. For one individual, rebuilding was a super long stressful process. The construction workers who were working on site were incompetent. Eventually, the condo got rebuilt, but it wasn't perfect, and it was extremely stressful from the beginning to the end. For the other individual, they had to take a lawyer because the insurance want to pay, but the insurance doesn't want to pay the real amount that is needed to rebuild.

Don't ever think that it's actually easy to deal with insurances, even in Canada. Because it isn't. Homeownership is made for rich people, not for the middle class. In the close future, it's simply going to be harder and harder. And sincerely, you need to be completely out of your mind to pay a 300k, 400k, and more for a condo... It just doesn't make any sense at all. I way prefer to have a $340,000 portfolio, mostly in stocks, from which I earn an income. Owning a house won't bring in any dividend, it will only make me spend even more money.

And that's why I decided to be a Queen without a castle.

Where I live in New Brunswick, we have here and there abandoned houses. In recent years, we have at least 3 houses, located close to where I live, that had been abandoned. One, it's a guy with a family that left the home trash. A few vehicles had been left there as well here and there on the lot. The house is probably nonhabitable in its current state. More than vehicles, a few cats had made their apparitions. We never had a problem with domestic animals in this area before. But now, from time to time, I see this bad boy, that I also spot earlier this summer: 

This little buddy also has a little grey friend that appears to be a bit younger. I don't know if you can spot him in here:

I just saw those two cats who seem to be living outside. It's a bit sad to watch because once winter will hit for real, those little cats will suffer. I personally adore cats but I suffer from allergies so I cannot even get close to them, even if I would like to.

Here are pictures of a house that I think is kind of abandoned. However, the lawn had always been taken care of for the time that I had been around. I never saw someone inside or outside this house. I never saw a car there. The roof seems to be perfectly fine, but the exterior of the house began to slowly suffer. I actually really like this house. I like the balcony. It's quite a big house. I wonder how it looks inside.

What do you think? Do you like this house?


Anonymous said...

Hmmm, 41, I thought one of your posts awhile back said you had just turned 40??

Regardless, I think 340,000 at this age is pretty good.

As for house, I guess it all depends on how much you pay for a house, and if you actually like living wherever it happens to be. And how much the rent is versus a loan payment. And what kind of lifestyle you live, But yes, renting can save you alot of grief with regards to repairs etc, and you can also move very easily. But if a house, and paid for then you always got a place to go.....................

Anonymous said...

And the house looks alright from these pictures, looks like it is on a farm or something

Anonymous said...

My wife, who was making 35k$ a year, was quite fine selling her 90,000$ Montreal condo 10 years ago for a 25,000$ profit, after about three years.

We then bought together a new 360k$ Montreal condo, which we sold last year for a 180,000$ profit. Zero taxes because it's the primary residence. We refinance the house and invest in stocks AND we have a nice house to raise our kids in.

Having bought property is very much part of how people became well off later in life. People who wait to be rich enough before buying property can never get there; ownership is part of making it.

Housing is definitely for the middle class and not for the rich. There is 60% homeownership in Quebec! Are these people all "the rich" and if so who exactly are the middle class? The middle class is not the poor, it's the MIDDLE class.


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